Check Eligibility Criteria for Pradhan Mantri Mudra Loan Yojana


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Pradhan Mantri Mudra Yojana (PPMY)

Mudra loan under Pradhan Mantri Mudra Yojna (PMMY) was a scheme launched by the Indian government in 2015 to provide financial assistance to small businesses and start-ups. The scheme aims to promote the growth and expansion of your business by offering a loan facility via formalised banking channels. 

The loan amount fulfils the capital requirement needed for operational costs, manufacturing, infrastructural development, etc. If you fulfil the eligibility for Mudra loan, you can get up to ₹10 lakh as fund assistance under PMMY. 

Key Features of Pradhan Mantri Mudra Yojana 

  • Access in Rural Areas – Business owners or micro-enterprises established in rural areas where no banking facility is available can also access the Mudra loan under PPMY.
  • Government is the Guarantor –  The government automatically becomes your official guarantor if you avail Mudra loan from any formalised banking channel under PMMY. So in situations, where the borrowers are unable to repay the loan amount, the government is liable to compensate the banks with the loan amount.
  • Flexible Repayment Period – Under PMMY, the borrower can select a repayment period according to the financial goals and capacity. The repayment period is extendable for up to seven years.
  • Zero Collateral – The applicant does not require any collateral to get Mudra loan approval from banks.
  • Discounted Interest Rate for Women – Government aims to promote and encourage female entrepreneurs and therefore offers lower interest rates for Mudra loan.

Types of Loans Under Pradhan Mantri Mudra Yojana 

Government offers three types of Mudra loans to entrepreneurs by evaluating their capital requirement and business model – 

  • Shishu – This is considered the initial stage of the business, where PMMY offers financial assistance of ₹50,000.
  • Kishor – The businesses require the capital to boost their operational and production activities, and therefore PMMY offers capital assistance up to ₹5 lakh.
  • Tarun – Under this category, the fund is generally required for the expansion and diversification of the business. One can avail of a loan for up to ₹10 lakh under this category.

Eligibility Criteria of  Pradhan Mantri Mudra Yojana 

If you want to avail a loan under PMMY, you should first check if you fulfil the eligibility for Mudra loan. Here is the basic eligibility criteria for availing loan under PMMY-

  • The applicant should be a native of India.
  • The applicant should be between 18 -65 years of age.
  • The applicant should hold a business in the manufacturing, trading, etc. industry.
  • The fund requirement should not exceed ₹10 lakh.
  • The applicant should have a zero-defaulter record in banks and financial institutions
  • The applicant should not hold any criminal record.

Who is Eligible for a Pradhan Mantri Mudra Yojana?

Apart from the above-mentioned basic criteria of eligibility for Mudra loan, here is a list of eligible entities that can avail of the benefits of the Pradhan Mantri Mudra Yojana –

  • Shopkeepers, Dealers, Retailers, Street Vendors, etc. who belong to the self-employed service sector
  • Owners of handloom, khadi workshops, knitting workshops, etc. belonging to the textile industry.
  • Individuals who manage tiffin centers, cafes, food stalls, etc. belonging to the food production and consumption sector.
  • Micro enterprises or companies that carry out fishing, dairy, poultry, etc. activities from the agricultural sector.
  • Community businesses like tailoring shops, medical stores, salons, etc. 
  • Truck Owners
  • Micro or small-scale manufacturers 

Eligibility Criteria for Lending Institutions Under Pradhan Mantri Mudra Yojana 

Since it is a government-launched scheme, there are specific eligibility parameters for lending institutions as well. One must qualify the below-mentioned pointers to become an official lending institution for a mudra loan

  • The lending institution must accrue profits in the last two financial years.
  • The Net performing assets should be under –
  • Public Banks – 15%
  • Private Banks – 10%
  • Regional Rural Banks – 6%
  • The Net valuation should be above –
  • ₹250 Crore for public and private banks
  • ₹ 50 Crore for regional rural banks

Who All are Eligible as Lending Institutions Under Pradhan Mantri Mudra Yojana 

  • Commercial Banks
  • Micro or Small Finance Banks
  • Micro Finance Institutions (MFIs)
  • Non-Banking Financial Corporations (NBFCs)
  • Railway Recruitment Boards (RRB’s)

Documents Required for Pradhan Mantri Mudra Yojana 

  • 2 Passport-size photographs
  • Mudra loan application form
  • Identity Proof – Aadhar card, PAN card, etc.
  • Address Proof – Passport, Utility bills, etc.
  • Income Proof of the business
  • Business Registration Proof
  • Consolidated bank statement of 12 months
  • Caste certificate (only it is applicable)
  • Income Tax Receipt of past two years
  • Document that states the purpose and requirement of the fund.

**Note – The documentation procedure might require some additional documents depending upon the norms and policies of the banks.

List of Lending Institutions Offering Pradhan Mantri Mudra Yojana 

Bajaj Finserv Karnataka Bank Lendingkart Finance
Bank of Maharashtra Axis Bank Saraswat Bank
Bank of India Tata capital Canara Bank
YES Bank Central Bank of India ICICI Bank
Kotak Mahindra Bank Punjab National Bank IDBI Bank
State Bank of India Bank of Baroda HDFC Bank


There are around 17 private banks, 27 public banks, 31 regional rural banks, 25 NBFCs, 4 cooperative banks and 36 micro-finance institutions offering Mudra loan  under Pradhan Mantri Mudra Yojana to the eligible entities. One can apply online as well as offline for PMMY as per their comfort and convenience.


  • Is it mandatory to submit an ITR receipt during the PMMY documentation process?

Yes, it is mandatory to submit ITR receipts for the last two financial years during the PMMY documentation process.

  • Can I get any subsidy under the Pradhan Mantri Mudra Yojana loan?

There are no subsidies available for mudra loan under the Pradhan Mantri Mudra Yojana.

  • I am a college dropout. Can I avail the benefits of the Pradhan Mantri Mudra Yojana?

Academic qualification is not a requirement to decide your eligibility for Mudra loan. If you wish to start your own business, you can apply for the Pradhan Mantri Mudra Yojana.

  • What is the maximum loan amount one can avail under Pradhan Mantri Mudra Yojana?

One can avail maximum loan amount of ₹10 lakh under the Pradhan Mantri Mudra Yojana.

  • Is the CIBIL score taken into consideration as an eligibility criterion for Pradhan Mantri Mudra Yojana?

No. CIBIL score is not taken into consideration as an eligibility criterion for Pradhan Mantri Mudra Yojana.

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